With the Amazon FBA program, you can outsource your business tasks to AMZN’s expert team for a fee. If you have heard about the program, you may have considered using it. Amazon FBA fees are usually the only reason sellers hold back from signing up for the service.

In this article, we will try to break down the different Amazon FBA fees to help you make informed decisions.

General Amazon Seller Fees

These Amazon seller fees apply to both FBA (Fulfillment by Amazon) and FBM (Fulfillment by Merchant) sellers. So, regardless of the fulfillment model used, all sellers are required to pay these Amazon seller fees.

Selling plan fees

Amazon offers two selling plans: individual and professional. If you choose the individual selling plan, you are not required to pay a monthly subscription fee. But, you’ll need to pay $0.99 for every sale. 

On the other hand, the Professional selling plan requires a subscription fee of $39.99/month. With the Professional selling plan, you also get access to features such as Amz Seller Central, APIs, third-party tools, and other perks unavailable with the Individual selling plan. You also don’t have to pay $0.99 every time you make a sale.

Referral Fees

What is the Amazon referral fee? The referral fee is the commission you must pay every time you make a sale. This fee is separate from the $0.99/sale you have to pay if you use the individual selling plan.

Referral fees differ depending on the product category. Some products mostly range from 6–8% of the total cost, while others can go as high as 15%–45%.

See a full breakdown of Amazon referral fees by category.

Amazon FBA Fees Explained

Amazon FBA is short for Fulfillment by Amazon. It is an order fulfillment service that allows third-party sellers to outsource their business tasks to AMZN’s team. When you sign up for FBA, AMZN will handle storage, shipping, and order fulfillment on your behalf. They will also provide 24/7 customer service and manage return processing for you. The service is very beneficial, especially for sellers who have a lot of commitments and need a system that allows them to accomplish more in less time.

If you use FBA, you must pay Amazon FBA fees. These fees do not apply to sellers who opt to fulfill their orders themselves. So, if you choose FBA, you’ll have to pay Amazon FBA fees in addition to the regular seller fees. Here’s a breakdown of your fees when you sign up for the service.

Storage Fees

On the FBA service, AMZN stores your products in its fulfillment centers until your orders are ready to be shipped. Since you’ll be taking up space in AMZN’s warehouses, paying an inventory storage fee is normal. This fee covers the storage of all your inventories in fulfillment centers.

Depending on the category and size of your products, different fees will be applied. There are two kinds of storage fees: monthly and long-term storage fees.

Monthly storage fees are charged monthly and are determined by the amount of inventory space you occupy in AMZN’s warehouse. The fee is either deducted from your account balance or added to your credit card if you do not have enough funds to cover it.

Every month, on the 15th, AMZN cleans up its inventory. During the clean-up, they keep track of any products sitting in their fulfillment centers for more than 365 days.

Sellers incur a long-term storage fee of $6.90 per cubic foot of storage used or $0.15 per unit, whichever is more, for things stored for 365 days or longer. Long-term storage fees are deducted on the same day every month and in the same way as monthly storage fees.

Check out a detailed breakdown of FBA storage fees.

Fulfillment Fees

Whenever a customer purchases a product from your store, AMZN will pick, pack, and ship the product. This service isn’t free, so AMZN charges a reasonable fulfillment fee. The fulfillment fees will also depend on the size of your product and its category. FBA shipping fees are usually lower than regular Amazon seller shipping rates. This is because AMZN is a large firm and can negotiate favorable shipping rates to cut down on costs. Individuals, on the other hand, have to pay the standard shipping fees depending on the firm they choose to use.

Yes, you can save costs on shipping when you sign up for FBA. However, you’ll have to meet FBA shipping requirements if you want to use the program.

See fulfillment fees for each category

Miscellaneous Fees

These fees apply to FBM and FBA fees and will only be incurred under certain circumstances. So, not every seller will have to pay the fees listed here. They include:

Closing Fees

Media products such as books, DVDs, CDs, and Blu-ray incur a $1.80 closing fee per sale, and only vendors who specialize in selling these items are subject to these fees.

Closing fees, like referral fees, are deducted from the sale proceeds, so you don’t have to pay them in advance.

High-Volume Listing Fee

Sellers with thousands of ASINs may be charged a $0.005 per qualifying ASIN monthly flat fee. You won’t have to worry about these costs unless you have more than 100,000 products listed.

Fees for high-volume listings and FBA storage are paid simultaneously. These charges are debited from the balance in your seller account. The payment will be taken from your credit card if your account balance is depleted.

How to Calculate Amazon FBA Fees

If you use the FBA program, you must factor in the service cost when fixing product prices. If you don’t, you’ll end up making losses because the fees will eat into your profit margin. The best way to avoid this is to learn how to calculate your Amazon FBA fees. According to AMZN, the fees are calculated based on size and weight.

The fees you’ll incur will depend on what size category your product falls into. AMZN classifies products into standard-size and oversized items.

Standard Size is applied to items that match the following criteria:

• It weighs a little more than 20 pounds.
• It has a maximum length of 18 inches.
• It has a 14-inch median side.
• Its shortest side is a little more than 8 inches long.
• The totals of all items in a set are added together to form a single total.

For standard-size items that weigh about 1 lb or less and special oversize items, estimate the cost based on product weight. For other items, use either the dimensional or unit weight (whichever is higher).

Dimensional weight = Unit volume (length x width x height) ÷ 139. 

Here’s a size guide from AMZN’s website.

To calculate the size+girth as shown in the table above:

1. Measure the length, height, and width.
2. Next, add the shortest and median sides together, then multiply by 2 to get the girth. 
3. Now you can add the girth and longest side. 

Check out Amazon’s product size tiers

Benefits of Amazon FBA

Signing up for FBA is not a waste of money but a great business decision. However, any business decision that isn’t free must be considered thoroughly before jumping on it. So, is Amazon FBA worth it? Here are a few benefits of the service to help you weigh your options.

Competitive Advantage: Using FBA makes you eligible to provide free same-day or two-day shipping for Prime customers. Buyers are more inclined to place an order when they don’t have to pay delivery fees. So, if you use FBA, your conversion rates are likely to increase.

Ease of expansion: Because AMZN fulfills your orders, you don’t have to worry about the logistics side of things. You may now concentrate on pushing your company to the next level. You can fulfill additional orders as they come in by storing your inventory in fulfillment centers.

Return Processing: As part of the FBA service, AMZN also manages order return processing on your behalf. This leaves you with one less thing to worry about.

Large storage space: How much inventory could you possibly store without FBA? Do you own or can you rent a warehouse? Are you capable of moving and handling that much inventory? This is where the FBA program shines. Because AMZN has warehouses all over the country that can hold your goods, you virtually have unlimited storage space—for a fee.

Disadvantages of FBA

Cost: Beginners may be unable to afford Amazon FBA fees. FBA is a beneficial service, but it is not free. Some people may not have to spend that money right now. Furthermore, this service isn’t suitable for low-cost things because fees are determined, so you’ll want to know which products you enroll in. Fortunately, you can use an Amazon FBA calculator to calculate Amazon FBA fees.

Increased Returns: FBA sellers have reported experiencing an increased return rate. This results from AMZN’s swift return policy that allows buyers to send items back easily.

Product Prep Requirements: AMZN has prepping and packaging requirements. So, before sending your products to fulfillment centers, you must ensure that they are properly packaged, labeled, and dispatched according to the FBA inventory warehousing rules. Some of the subtleties can be difficult to grasp.

The FBA program comes with its pros and cons, but the pros outweigh the cons. So, if you can afford the Amazon FBA fees, you should go for them.

Related: How to use an Amazon FBA calculator

How to Reduce Amazon FBA Fees

Only Store Selected Items in Fulfillment Centers

Do you know that storing certain items in fulfillment centers will only drag your bottom line down? The less expensive the item, the more expenses you’ll incur if you ship it through FBA.

Avoid shipping items that cost less than $15 through FBA. Inventory storage fees are based on weight and size, not price – if you have a $3 item that weighs the same as a $150 item and costs the same to fulfill, your profit margin on the $3 item will most likely take a hit.

Next, attempt to keep the number of heavy goods you keep to a minimum. You’ll have to pay more for their extra weight, and this is an extra cost that may eat into your profit margin. Unless you’re making a lot of money on those products, it might be a good idea to reconsider selling them.

Create More Product Bundles

Bundling is a great way to cut down fulfillment costs. If you sell five items, you must pay fulfillment fees on all five of them. However, if you bundle those items into a single unit, you only have to pay fees for one item, not all, because the bundle is considered one item. So, bundling the products together is a simple and inexpensive task if you want to cut down costs.

Monitor Your Inbound Performance Alerts

Amazon sends you inbound performance warnings when there are problems with your shipments. When problems develop, Amazon will charge you to resolve them, so don’t make the same mistakes again and over again, since this will result in higher fees.

Inbound performance feedback can be found in Seller Central, including specifics on what went wrong and how to avoid it in the future.

Zonbase: The Best Software Tool For Sellers

Whether you plan to use FBA or FBM, you still have to find products to sell. As a third-party seller, finding the right products to sell is essential for your success on AMZN. Choosing the right products can allow you to earn a lot of money. However, choosing the wrong ones can bring about financial loss. This is why you need a software suite that can help you find the right products to sell on AMZN.

Zonbase, with its 13+ tools for product research, sales optimization, and listing optimization, is one of the best software suites today. With Zonbase’s Zonresearch, you can filter products to find the best products to sell in each category.

Zonbase also has its own Chrome Extension tool, which allows you to dig inside AMZN’s database. With this browser extension, you can find sales and revenue data for products on AMZN. As a seller, having access to this powerful tool is significant. With Zonbase, you can make data-driven decisions and get a competitive advantage over your competitors.
If you are interested in knowing more about Zonbase, you can sign up for a free trial.

Conclusion

Want to save time and get better results from your business? It would help if you considered outsourcing the heavy lifting to AMZN through FBA. The service is not free, but the costs are reasonable. If you read to this point, you already have an idea of the Amazon FBA fees you’ll have to pay. Go ahead, factor in these costs when fixing your product prices, and you’ll be good to go.

Chapter 1: All about Amazon FBA
Chapter 2: How to sell on Amazon FBA
Chapter 3: What to sell on Amazon FBA?
Chapter 4: Use ZonBase, Amazon software to dominate on Amazon
Chapter 5: Marketing your Amazon FBA business

Chapter 1: All about Amazon FBA

What is Amazon FBA?

Amazon FBA is a great service provided by Amazon where the fulfillment of the products like the storage, packing, shipping, and returns are taken care by Amazon itself. So the third-party sellers will not have to worry about it and focus all on growing and scaling the Amazon business.

Amazon FBA vs. Amazon Fulfilled by Merchant

Amazon provides the Fulfillment by Amazon (FBA) and Fulfillment by Merchant (FBM) services to fulfill orders placed by customers.

We have already discussed the first option, Fulfillment by Amazon. The second option Amazon offers you to do the fulfillment yourself. You are solely responsible for the storage, packaging, shipping, and even customer service. Amazon only provides the marketplace and its customer base for your Amazon FBM  business.

Amazon FBA

Amazon FBM

How does Amazon FBA work in 2024?

Every Amazon seller follows the common initial steps which are:

• Finding your profitable product
• Creating a seller account
• Choosing between FBA and FBM

Let’s take a closer look at how the Amazon FBA model works for your business:

Send your products directly to Amazon

As an Amazon FBA seller, you have to prepare your products the way you want your customers to receive them. You then need to send these products to Amazon’s various warehouses at the address provided by Amazon.

Amazon stores the products

After receiving the products, Amazon adds them to their inventories and stores them safely. If in any case your product is damaged, Amazon will take full responsibility for it and reimburse you for the damage.

Amazon processes the order

Customers will find your product through your product listing or Ads on the Amazon platform and place an order. Everything is done on the Amazon platform, the order, payment, etc.

Amazon ships your product

After receiving the order Amazon packs and ships the product to the customer’s address. It receives the payment either online or through cash/card on delivery. You do not have to worry about shipping and payment.

Amazon handles customer service and returns

After a customer receives the product, Amazon follows up to make sure they have received the product in adequate condition and to get their feedback. It also handles any return request.

You get paid

Amazon calculates your sales and deposits your profit deducting seller fees into your account every two weeks.

Is Amazon FBA profitable in 2024? Is Amazon FBA saturated?

As long as people continue to buy products from Amazon and as long as these eCommerce giants continue to grow, there will be an opportunity for every new seller.

According to a report, 53% of Amazon sales come from third-party sellers in the first quarter of 2019. Amazon FBA will not be saturated for new sellers in the near future whether 2024, 2025, or 2030.

With every new year, the strategy will surely change. The strategy that worked for sellers in 2016 will not be going to work in 2024. So, you have to work on creating your strategy and Amazon business plan that will make you profitable in 2024.

Chapter 2: How to sell on Amazon FBA

Do I need a business plan for starting an Amazon FBA business?

Yes, you definitely need a business plan to start your Amazon FBA business. What your business plan will include?

• Budgeting
• Finding the right product
• Searching for suppliers
• Making strategies to market your product
• To make your business profitable

You need a plan to invest in the right information, the right software, and tools. Otherwise, there is a high chance you end up paying more than you should.

You do not need a real business plan like the traditional big businesses, but you need a direction to what you want and how you will get it.

How much it costs to sell on Amazon FBA?

Answering how to sell on Amazon FBA would be incomplete without knowing the cost of starting it.

Starting an Amazon FBA business needs a budget from you, you can not start it if you are on a razor-thin budget. How much will it cost? Let’s look at the breakdown of the Amazon FBA business budget.

• Amazon software cost: $500
• Ordering product samples: $150
• Cost of Inventory: $1500
• Barcode or UPC code: $40 to $250 per 10 barcodes
• Cost of products shipping: $500
• Giveaways or PPC: $250
• Amazon seller central fee: $39.99
• Amazon course online (optional): $2000-$5000

Total Budget- $2,787 (excluding course budget).

Ready to start your own selling on Amazon FBA business?

Create your Amazon seller account

To start your journey as an Amazon FBA seller, you need to first create your Amazon seller account. Go to the SellerCentral page of Amazon and click “Register Now” or “Start Selling on Amazon”. You will get a signup page, it will take up to 10 minutes and you will be registered as an Amazon seller.

Start looking for products to sell on Amazon

To make your Amazon business profitable, you first have to find the perfect product. You have to analyze the market, current trends and customer needs to select the product or products to sell on Amazon.

You can do the process manually or there is much software like ZonBase, Jungle Scout, that will help you. Using the software will save you a lot of time and give you accurate results.

Find your supplier

After you have found your product, the next step is finding your supplier. You can search for your product supplier on Alibaba, shortlist some suppliers based on ratings, reviews, no. of products sold, etc. Talk to each of them and ask for the best price and then select your supplier. But, before ordering the products in bulk, you need to order some samples to check the quality of the product.

Create your Product Listing

Now that you got your products, You need to create your product listing. Not just create them but have to optimize them for the right keywords that your customers will use to find your items.

Here are some tips to optimize the product listing on Amazon:

• Use a simple and attractive title with your target keywords.
• Keep the description short and to the point.
• Use bullet points for long descriptions.
• Add multiple images to your product listing.
• Talk about the benefits of the product.

Advertise your Product

After you have created your product listing and sent the products to Amazon warehouses, you will need to market your products. Combine Amazon PPC advertising with Giveaways for the sale to start coming.

Chapter 3: What to sell on Amazon FBA?- Finding your perfect product

How to find products to sell on Amazon FBA?

The best way to find a profitable product for you is to use Amazon product research tools. It saves a lot of time and often gives more accurate results. Following is one of the best product research tools:

Zonbase:  Zonbase has every tool you’ll need to be successful on Amazon. You will also get exclusive training on how to use those tools. If you haven’t already done so, go ahead and take advantage of the FREE trial today.

What are some good sourcing companies for Amazon FBA?

Once you have found your Amazon FBA product, the next step is to look for your supplier. You can search for your supplier from Alibaba or Wholesale marketplaces.

How to source a product on Alibaba?

Alibaba has various suppliers and manufacturers on its platform. It’s a great place to source products that are great and inexpensive at the same time. You can talk to the suppliers on the platform itself and find out who is best for you. You just have to go to the website, search for your product, you will see a list of products, a shortlist based on reviews, ratings, no. of products sold, etc.

How to source a product on Wholesale marketplaces?

The wholesale marketplace is another option to source products. You can find a wholesale market in every city, you have to locate a wholesale related to your product category. You can google to find the wholesale stores.

Which products sell best on Amazon

So, what to sell on Amazon FBA? Some product categories are the best selling on Amazon. Let’s have a look at some of them:

Books: Books are one of the best-selling Amazon products and their demand is not going down anytime soon. Whether it’s hardcopy, paperback, or Kindle edition, books are more popular than ever, and they come with a huge profit margin.

Baby Products: As new babies are born there will be increased demand for baby products.  These items are a great option because baby products are inexpensive, small in size, lightweight, durable, and always in demand.

Jewelry: Jewellery products are always hot-selling items on Amazon. Yes, the market is saturated, but you have to be pro at marketing to make it profitable. The profit margin for this product can be 50%+.

Gym and SportsWear: People of all ages want to be healthy, and, for that, they need workout wear. It is another top-selling product on Amazon with a good profit margin.

Chapter 4: Use ZonBase, Amazon seller software to dominate on Amazon

If you are a seller on Amazon and looking for the best software that can provide you with the instantaneous promotion of pages, books, courses, and all your products and become a successful seller on Amazon, try ZonBase for a better experience and optimum outputs.

What is ZonBase?

ZonBase is an online platform for Amazon sellers to get their leading products conveniently. This is a simple and user-friendly software that provides fast and one-click results for Amazon busy sellers. You don’t need to check hundreds of reviews and posts to get valid information. By providing ideas of reverse and hidden keywords, this software enhances the sale of your products. You just have to put accurate and simple information, and your profits will be auto-pilot.

Important Tools of ZonBase:

ZonBase software features the following tools:

• Amazon keyword research & Analysis
• Amazon PPC/Advertisements
• Brand ranking analysis
• Find Profitable hidden niches
• Estimates revenue of products
• Reverse ASIN
• Listing optimizations
• Do advertisements
• Track your brand ranking

How ZonBase work?

• You can try it now. It’s available on a free trial
• The registration process is effortless. It will take almost ten seconds to get registered.
• Start using the tool if you want to find the best products in your niche that are selling well on Amazon, which can work well for you.
• ZonBase offers free training by Amazon experts so that you can leverage their experience and skill to up your game.
• The software provides excellent 24/7 customer support.

Advantages: How ZonBase can help you to achieve success on Amazon FBA

Free trial

You can use it for 7 days free trial. After that, you have to pay annually to upgrade its services. It is offering effective packages within your limited range of cost. You can cancel your subscription whenever you want.

ZonResearch and chrome extension

ZonBase is designed for busy researchers who need to quickly find the right information. If you have a shortage of time, you should not pour through hundreds of reports to find the gold nuggets. Zonbase makes it easy for you to find deep into more than millions of products. ZonBase offers you some really amazing tools capable of helping you find your winning product online.

ZonBase chrome extension will help you to discover your new product from millions of products from Amazon’s database. It will speed up your research.

Sales estimator and Zontracker

Sales estimator is an amazing tool of ZonBase to spy on your competition and to check the selling of goods or launching a new product. It will assist you to find an average amount of products selling for each product per month. Zontracker can track the ranking of your product for any of your chosen keywords.

Keyword research

You can target your best keywords and, in this way, enhance your Amazon profit. It makes your research easy and accurate.

Finding hot products

You can find the best products on Amazon on a daily basis. It will also help you to optimize the listing of products. This optimization will help you to attract customers.

Product validator

There is a team of experts that will assess and analyze your product before investing. These experienced launch managers will guide you in enhancing the quality of your product that is necessary for boosting your profit. It will automatically raise the chance of your success.

Photo enhancer

ZonBase has a tool to take pictures of your product and to keep it in a natural setting in a way that is attractive and appealing to customers. It can take the perfect pictures of the products for less than half the cost.

Cost-effective

ZonBase provides everything that a growing Amazon business needs to succeed in the Amazon market. If we talk about pricing, ZonBase offers you decent-priced packages that are really affordable and won’t put a big load on your pocket. The good thing is that ZonBase provides you unlimited access to all their tools for free for 7 days. In this way, you can see how it works, after which you can follow up with a paid plan. You can also cancel your subscription anytime.

Brilliant customer support

ZonBase support team is available to help you with any kind of issue you face any time round the clock. Their super responsive support team is all the time available for your guidance.

Free training

You can call an Amazon expert freely to get all related information and ideas about how you will become a pro in the Amazon selling World and free ZonBase training courses you can learn about.

Chapter 5: Marketing your Amazon FBA business

How to launch and promote your product?

You have to adopt a mixture of tactics to make your product rank higher on Amazon ranking and make the sales start coming. Here are four strategies that definitely help you get more traffic to your Amazon listings.

SEO optimize your product listing

Optimizing your product listing with target keywords is the organic way of attracting customers to the product. Find target keywords using which your potential customers will find your product.

Sponsor your product using Amazon PPC

Use Amazon PPC campaigns to run sponsor ads to make your products visible to customers. You have to pay only when someone clicks your ad.

Share product listing on social media

Social media popularity isn’t hidden from anywhere. Businesses are also harnessing their power. Sharing your product listing on social media is a powerful marketing tool and a great strategy to reach more and more people. You can use Facebook ads to drive traffic to your Amazon product listing.

Partner with Influencers

You can use influencer marketing to gain significant traffic. If you do not have a big budget you can go for small influencers. Do not forget to measure your results after this.

What are some Amazon keywords tips?

Optimizing your product listing needs you to understand what your customers want, and what they are searching for. You have to think like them.

What is keyword research?

One important part of Amazon search optimization is keyword research. You have to research primary and secondary keywords that are used by customers while looking for products similar to yours.

The goal is to list all the keywords that are relevant to your product and then use them wisely and naturally on your product listing.

How to find keywords for your Amazon product?

There are two ways you can find keywords for your Amazon product listing: Manually and using tools.

Using a manual method you have to look for best selling items similar to your product, take a look at their product listing. Note all the keywords they are using. Think like a customer, what phrase you will use to find your products.

Using tools to get your keywords will save a lot of time and also give you a list of all the relevant keywords. You can use Zonbase, an all-in-one tool you ever want for your Amazon journey, to boost your product listing by targeting the right keywords.

Now here are some tips to find the right keywords for your

Amazon product:

1. Know your audience and understand what they need and search for.
2. Use both target keywords and long-tail keywords in your product description.
3. Do competitor analysis and tailor your keywords according to what best-selling items are doing.
4. Use an Amazon keyword research tool to get the right keywords in no time.

What is the Amazon Best-Seller Ranking?

Amazon Best-seller ranking is a process of ranking a product on Amazon. Amazon gives the best seller rank to all the products on its platform.

The ranking of a product is decided on the number of recent sales historical sales data relative to other products of the same category. The ranking is updated hourly for each product.  The rank differs for different market places.

Conclusion

Becoming a successful Amazon FBA seller is not everyone’s piece of cake but it’s not rocket science either. If you have what it takes to build a sustainable business, then you surely have to go for it. But you are in this to make money fast and get rich quickly then you’ll probably just waste your time and money. Just like any other business, Amazon’s selling business also needs consistency, a strong mindset, a problem solver, and lots of effort.

All the best for your journey!

Amazon Software Seller

Being an Amazon seller is a very lucrative business model but definitely not the easiest. Amazon is the biggest e-commerce platform in the world, and it’s still growing. Due to growing demand from sellers, it launched Fulfillment by Amazon (FBA). 

This means that Amazon will help you run your business, by taking care of the processes needed to fulfill your orders. In other words, Amazon will store your products and fulfill your orders, and will also offer customer service. To use the FBA service, you need to create an Amazon seller account and add FBA to your account. To do this, you will need to follow the guidelines on the website.

If you opt for the FBA service, all your orders will be taken care of by Amazon including shipping and round-the-clock customer service. Using this service makes running your Amazon business easy because you no longer have to worry about shipping and tracking customer’s orders. 

However, fulfillment is only one part of your business. You still need to do market research, find the products, negotiate deals, create Amazon listings for these products, and run PPC advertising. This can take a lot of time to learn and if you’re just starting, it’ll be very hard to compete with the big guys. Unless you use a software that helps you with all of that.
ZonBase is an emerging Amazon seller software that is attracting people from all over the world thanks to its ease of use and holistic approach to include all the tools that Amazon sellers need in one place. This software has a huge variety of tools ranging from the product research tool, the sales estimator, image enhancer, all the way to keyword optimization and machine learning for PPC advertising.